Medical dressings are a flagship product within China's medical device industry. However, the sector is now grappling with three major challenges: the global financial crisis, structural imbalances in the industry, and ongoing economic restructuring. As a result, the industry is experiencing slower export growth and weakening demand in traditional markets—issues that have made its path to future development increasingly complex and fraught with obstacles. To shed light on the current dilemmas facing China’s medical dressing industry and help businesses navigate their transformation and upgrade journey, this section launches today a comprehensive series titled "Where Does the Path for Medical Dressing Industry Transformation Lead?" We warmly invite industry professionals to join the conversation, offering insights, strategies, and practical experiences that can guide the sector out of its current challenges, seize emerging opportunities, and ultimately restore confidence in the market.
　　Medical dressings are a category of healthcare products within the hygiene materials sector, and they have consistently accounted for a significant share of China's export trade. Currently, China's exports of medical dressings now represent more than 20% of the global total for this product category. According to statistics from the China Chamber of Commerce for Import & Export of Medicines & Health Products, in the first quarter of this year, China's exports of medical dressings reached $565 million, an increase of 11.56% year-on-year. These exports made up 13.33% of China's total medical device exports during the same period. The top three destination markets were North America, Europe, and Asia, in that order.
　　"Although exports continue to maintain a relatively high growth rate, it’s important to note that China’s medical dressing exports to European and American markets are already showing signs of saturation. Coupled with intense competition within the industry, many export-oriented companies have begun shifting their focus toward emerging markets such as Saudi Arabia, Brazil, and Russia. As a result, it’s clear that China’s medical dressing industry will face increasing challenges—and even fiercer competition—in the years ahead," recently analyzed Professor Xi Tingfei from Peking University’s Institute for Advanced Interdisciplinary Studies at the "2015 Tuoren · 8th China Medical Consumables Conference" held in Henan.
　　New challenges keep emerging.
　　"Over the past three decades, the medical dressing industry in China's manufacturing sector has enjoyed relatively robust growth. Currently, the global medical dressing industry remains heavily concentrated in China," says Cui Jinhai, president of Aomei Medical, who boasts over 30 years of experience in the medical dressing industry. According to him, China’s medical dressing industry has broadly gone through four distinct phases. The first phase began in the mid-1980s, when the industry primarily supplied a single type of product—raw gauze. The second phase emerged in the 1990s, as companies started sourcing large quantities of raw materials for advanced processing, then exporting these refined products to regions like Europe and North America for packaging. During this period, both raw material supply chains and manufacturing enterprises diversified significantly, laying the groundwork for the industry’s rapid expansion. The third phase kicked off at the turn of the 21st century, marking a shift toward deeper processing and sophisticated packaging. In this stage, Chinese companies capitalized on the nation’s market and demographic dividends, enabling many firms to undergo transformative upgrades. They moved beyond producing basic raw materials, instead embracing integrated design solutions for products, equipment, and facilities—driving innovation that elevated product quality while pushing costs down to near "optimal" levels. This strategic evolution propelled the industry into its golden age, giving rise to industry leaders such as Wenkang, Aomei, and Zhende.
　　"However, as the industry advances to its fourth stage, you’ll find that it’s becoming much harder to catch the 'tailwind' of the market. The original demographic and market dividends are dwindling, leaving the industry grappling with a host of new challenges." Turning the conversation, Cui Jinhai added that China’s medical dressing industry is currently facing significant difficulties across six key areas: order pressure, rising raw material costs, tight corporate financing, escalating labor expenses, growing environmental responsibilities, and increasingly complex risk management issues.
　　The fluctuations in raw material prices for medical dressings have already triggered significant reactions within the industry, and Cui Jinhai has addressed this issue publicly on multiple occasions. At this conference, he pointed out that cotton is the primary raw material for medical dressings. However, in recent years, cotton prices in China have fluctuated dramatically—soaring to as high as 27,000 yuan per ton at their peak, yet dropping to just over 10,000 yuan per ton during troughs. In terms of financing, the industry previously enjoyed robust cash flow, with many companies focusing on serving mature global markets. But now, some enterprises have grown substantially in size. As a result, amid volatile raw material costs, these firms are facing increasingly tight liquidity challenges. On the labor front, wages for entry-level workers at medical dressing manufacturers were once capped at around 200 yuan per month—but today, they’ve surged to between 2,500 and 2,600 yuan, not even accounting for social insurance contributions. Consequently, companies are now grappling with rising costs for low-end talent while simultaneously struggling to attract and retain top-tier professionals.
　　"Currently, demand in traditional export markets such as Europe, the U.S., and Japan is becoming saturated, while domestic prices are rising rapidly—driving up costs for labor, raw materials, and shipping. As a result, export trade quotations have increased, gradually eroding the competitive edge of domestically produced medical dressings, which have historically relied on their strong value-for-money proposition in international markets. Meanwhile, currencies in Southeast Asian countries are steadily depreciating, further enhancing the cost advantages of these nations' products due to lower labor and material expenses, enabling them to capture a growing share of the market. At the same time, international trade protectionism is on the rise, with Europe and the U.S. imposing non-tariff barriers such as stricter quality standards, anti-dumping measures, and countervailing duties to limit China's exports of medical dressings," noted Xi Tingfei.
　　In recent years, China's manufacturing sector has generally been grappling with the growing challenge of meeting energy-saving and environmental protection responsibilities. According to Cui Jinhai, while the medical dressing industry doesn’t face as much pressure in terms of energy consumption and environmental impact as other manufacturing sectors, it still encounters significant energy-related issues. "Electricity prices are too high, and power quality remains unstable—both of which severely affect our production equipment," he explained. "To address the voltage instability issue alone, we invested hundreds of thousands of yuan in importing advanced foreign equipment." He also pointed out that domestic companies are now facing new challenges in risk management. While some enterprises are eager to tap into capital markets, they must understand that going public is a "double-edged sword." Many companies turn out to be surprisingly vulnerable when operating in the capital market, and their pursuit of financing could even jeopardize the long-term health of what were once promising businesses.
　　"Due to the relatively low barriers to entry in the industry, domestic medical dressing products suffer from severe product homogeneity, leading to a vicious cycle of price-based competition. Additionally, most exported medical dressing products are sold under OEM (original equipment manufacturer) branding, with very few domestic companies successfully establishing their own global brands in international markets. Moreover, some exporting firms lack their own dedicated export distribution channels, relying primarily on overseas distributors to reach customers," analyzed Xi Tingfei.
　　Seize opportunities to reshape fundamentals
　　Although the medical dressing manufacturing industry is facing a complex and challenging environment, many expert attendees remain optimistic about the prospects of the international medical dressing market. Professionals from the Medical Insurance Chamber of Commerce analyzed that the current market for medical dressings still holds significant growth opportunities, urging domestic companies to proactively tackle these challenges and boldly "break the ice."
　　"As the global issue of population aging becomes increasingly prominent, leading to a rise in patients suffering from conditions like ulcers and pressure sores, the international demand for medical dressings is expected to continue growing. Meanwhile, with China’s ongoing healthcare reforms, the advancement of personalized medicine, and evolving demographic trends, the country’s medical dressing manufacturing industry is poised for rapid expansion. Xi Tingfei pointed out that on May 8 of this year, the State Council unveiled the "Made in China 2025" initiative, outlining a strategic "three-step" plan over three 10-year periods to transform China into a global manufacturing powerhouse. Among the "Ten Key Development Areas," the plan explicitly emphasizes enhancing innovation capabilities and boosting the industrialization of medical devices. This includes prioritizing high-performance diagnostic and therapeutic equipment such as imaging systems and medical robots, as well as critical medical consumables like fully biodegradable vascular stents and high-value products like wearable devices and remote healthcare solutions. Additionally, the initiative aims to drive breakthroughs and practical applications in cutting-edge technologies such as bio-3D printing and induced pluripotent stem cells—technologies that will significantly accelerate the growth of China’s medical device and medical dressing sectors."
　　"From Industry 1.0 to Industry 4.0, the evolution reflects how production methods continuously transform under the interplay of productivity and production relations. This transformation manifests itself as all elements—such as people, machines, enterprises, customers, and suppliers—gradually expanding while systematically eliminating non-value-added processes between them, ultimately giving rise to a robust value chain. At its core, this process revolves around value enhancement and direct connectivity. The development journey of China's medical dressing industry vividly illustrates how the sector has evolved toward value upgrading and integrated, direct connections. According to Cui Jinhai, on the path of transformation and upgrading in the medical dressing industry, some companies can adopt strategic approaches like shifting from export-oriented to domestic sales, transitioning from contract manufacturing to brand ownership, moving from low-end to high-end products, evolving from extensive practices to precision-focused operations, and extending their industrial chains. By consistently innovating across areas such as strategic management, business models, products, processes, and equipment, these companies can fundamentally reshape their competitive edge."